Partnerships to Joint-Stock Companies: Accumulating Capital in 19th-Century Eastern Mediterranean Contexts

From the 1830s until the fall of the Ottoman Empire after World War I, merchants based in Beirut turned their small tax-farming family partnerships into major global corporations. This article will trace the evolution of this change in Eastern Mediterranean contexts. Specifically, it will show how the companies’ members vertically integrated their businesses and how they contributed to the operations of global capitalism more broadly. In so doing, it rejects recent economists’ conclusion that limited liability and other techniques for successful capital accumulation were European imports to the Empire.[1] On the contrary, it shows that Ottoman-, European-, and other Global Southern-based companies negotiated the operations and epistemologies of the twentieth-century capitalist market.

In its exploration of this major argument, the paper will make three smaller overlapping contributions. First, it will show how the companies’ members grew their companies in an environment of increased nineteenth-century global competition and exchange by drawing on techniques available to them in late-Ottoman contexts. These techniques included but were not limited to sharecropping, waqf, and middle-class marriage practices and norms. Second, it will contend that the companies used these techniques to accumulate capital through global trade and silk and cotton production following the Crimean War (1853-1856). With this capital, the company members grew their business and became vertically integrated joint-stock companies with limited liability and public shareholding schemes stretching across oceans from Beirut to Liverpool and as far south as Rio de Janeiro. Broadly, this paper will show how Beirut-based companies influenced global capitalism through their partnerships with and investments in other global trading and manufacturing firms in the global capitalist market.

[1] For example, Seven Ağır and Cihan Artunç, "Set and Forget? The Evolution of Business Law in the Ottoman Empire and Turkey," Business History Review 95, no. 4 (2021).